Policy debate
[Continued from Page I]
Factors which contributed to
satisfactory year for
v 'dairy fanners were good
prices for milk and
reasonable production costs,
Sumner said. The only
change next year is that
production costs may run
slightly higher, he said.
At the moment Sumner
said, dairy farmers are
“victims of an increase in
production which always
accompanies an increase in
price.” In times of good
price, Sumner said, dairy
farmers always push for
peak production which
results in supply going up
while demand remains
constant. Consequently,
there is lower Class I
utilization which means a
lower blend price for far
mers.
Sumner talked about
factors which influence the
milk market, and used the
incident of last week’s
radiation report as an
example of something
“which hit the dairy industry
hard because of over
reaction to the situation.”
Sumner said the dairy in
dustry is hardest hit not
because its product is more
vulnerable than other
products, but because the
industry has an excellent
sampling program already
in existence which makes it
easy to run extra tests, in
this case tests to determine
the levels of lodine 131.
Despite the fact that the
levels never approached
dangerous levels, there was
an adverse impact on sales.
Sumner added that a good
year for pricing in 1977
hinges on the Secretary of
Agriculture continuing to
adjust milk supports to 80
per cent of parity. Assuming
this happens, dairymen can
look forward with confidence
to a good year, with prices
probably not dropping more
than $.15 per hundredweight.
Miles, Thomas,
representing Merrill, Lynch,
Pierce, Fenner and Smith,
Inc., mixed both good and
bad news in his report about
the future. He said it is his
opinion that the beef market
has bottomed out and that
livestock prices will go up.
This is tempered, of course,
with the realization that “if
com prices skyrocket, this
projection will be altered.”
Now that harvest is
coming into its final stages,
Thomas said it is more
possible to get a clearer
picture of what is to come.
Commenting on the
tremendous impact of
weather on prices, Thomas
said that previous predic
tions of $2.00-on bushel com
will not come true because of
the midwest droughts which
brought down total
production considerably.
Now, in all probability,
Thomas suggests that com
will go..higher, although he
says it will not reach $3.50
and possibly not even $3.00
mostly because “you can’t
profitably feed animals at
that price.”
According to USDA
reports, Thomas said the
poultry industry is ex
panding and the 8-10 per cent
more broilers will be com
peting with beef and pork in
the future. “We have had a
strong hog market,” Thomas
Lancaster Farming. Saturday, Oct. 16,1976
said, “And now the prices
are down. You won’t see any
great price advance in the
hog market in the next three
to four months.” He added
that “perhaps the prices
won’t ,go downs,“but the hog
market is more treacherous
than beef.
Calling the grain market a
“guessing game,” Albert
Landis, grain merchandiser
for Pennfield Corporation,
discussed the major factors
which influence the price of
grains, saying that the law of
supply and demand stUl
controls the market.
He said the weather has a
very strong effect upon the
price of grains, and men
tioned the current heavy
rains m the United Kingdom
as an influencing factor
since seeding cannot be
done. After a severe drought,
the worst in 200 years, they
are now experiencing their
wettest autumn since 1918,
he said.
Domestic usage is also
important in pricing, Landis
said. Grains used through
livestock in this country is
three times the amount used
in export. Landis added,
“Feed demand for com and
beans will be the largest
single influence on the grain
market in the months to
come.” He pointed out that
for the past 20 years, “ex
pansion' of the livestock
industry has been predicated
on low cost feed.”
Grain exports also in
fluence the price, but here,
Landis says, “You run into
IBM
SALE
The chain saw that’s
huilt for the long
run as now priced for
the quack sale 'While
they last, the saw
that’s been pioneering
the industry for
more than 35 years is
available at substantial
savings, plus well
give you a loop of
replacement chaan
FREE.
A great price on a
powerful Pioneer that
will run cool and
smooth PLUS a free
loop of cham
only during the
FIONEER CHAIN
6* SAW SALE.
1073
• Pioneer power and
durability
• 14" bar
NOW ONLY
*159”
Plus CBCE spare chain
■ imfcfc worth sl6*
PIONEER
CHAIN SAWS
Buit for the long run.
GEHMAN
BROS.
SALES t SERVICE
1 Mile North of
Terre Hill on Rt. 897
1215)445-6272
politics.” He talked about
the possibility of a new
power split in the world -
petroleum power versus
agricultural power. He said
in his opinion agri-power is
now coining to the fore.
Landis also talked about
the desire for more animal
protein throughout the
world, based on a human
desire for an improved diet
which comes with a better
standard of living.
According to Abe Dif
fenbach, manager of the
New Holland Sales Stables,
the livestock market fluc
tuates widely today and
operates differently from the
time when the “Chicago
price” was all you needed to
get on Monday morning.
Today he said there is an 11
market total.
Diffenbach said beef
imports have a large impact
on the market and expressed
concern about some U.S.
territories which by-pass
import quotas by importing
meat, breaking it up and
processing it and in turn
bringing it into this country.
He said further that retailers
do not drop the price of beef
m the store in relation to the
live price. “I don’t think the
packer himself is the one
getting the money.” Other
large factors in the market,
he said, is supply and
demand, and beef grading.
Bob Heilbron, with the
Lancaster Stock Exchange,
also recalled a different
market, and the changes
which have taken place
during his 30 years in the
business. He recalled when
packers came to market on
Monday mornings ready to
buy. Today, he pointed out,
“They can go to market any
day of the week and they
don’t really need to buy
cattle because they have so
many different places to buy
livestock that they keep a
firm supply on hand.”
This situation, according
to Heilbron, is detrimental to
farmers. He urged the young
fanners to consider using
the market system more. He
said, “If more farmers and
more people would use the
market system as
established, they will have
more security in numbers
and will have more feel for
the ebb and flow of livestock
whether it is feeder cattle or
slaughter cattle.
“Market men can prove
that people who consistently
use the markets will in the
long run have livestock on
the market when activity is
better off than normal,”
Heilbron said.
In the general discussion it
was felt that corn prices
could reach $3 by mid
winter, and it was recom
mended that if local far
mers have the facilities it
would be wise to store com.
It is probably also wise, if
facilities are there, to buy
protein meal if necessary,
since an increase in soybean
price is almost certain.
Perhaps the most valuable
advice to the young farmers
came during the questions
following the formal
presentations when Abe
Diffenbach advised, “Stick
with what you’ve been
doing.” He said that in the
cycles of the livestock
business, a man will ex
perience good years with the
bad and the overall picture
will be positive.
TRY A
CLASSIFIED
AD!
19